Absence of reforms will slow growth: Chidambaram

Absence of reforms will slow growth: Chidambaram

Cautioning that absence of economic reforms will slow down growth, Finance Minister P Chidambaram on Monday said political parties may oppose but should not obstruct decision making.

"Every government is entitled to lay down policies. Opposition to policies is legitimate, obstructionism is not," Chidambaram said while addressing the annual Economic Editors' Conference.

"The government of the day must be allowed to lay down policies, pass legislations wherever necessary, and get on with the job of implementing those policies," he added.

Noting that these were challenging times, the minister said, "Without reforms, we risk a sharp and continuing slowdown of the economy which we cannot afford given the imperative need to generate jobs and incomes for a large population, most of whom are young."

Absence of reforms will slow growth: Chidambaram

India's economic growth during 2011-12 slipped to nine-year low of 6.5 per cent and during the first quarter of the current fiscal it was 5.5 per cent.

Expressing confidence that with requisite savings and investments India's economic growth rate will recover to 8 per cent and more, and perhaps touch 9 per cent, the minister said, "We should keep that rate of growth as our objective and progress towards achieving that objective."

Absence of reforms will slow growth: Chidambaram

The government recently took host of reform initiatives but steps like hiking FDI cap in insurance and pension to 49 per cent would require legislative changes, which would not be possible without the support of main opposition party BJP.

"Long standing structural reforms required to achieve high investment and high growth rates have been held back because of many reasons.

"Among them are...the need to forge a consensus on reforms, the practical necessity to garner support across the political spectrum to pass legislation... Nevertheless we are now addressing the difficult areas of reforms", he added.